Accused of fraud against Chevron, lawyer is defiant in defeat

Source: Reuters - Tue, 4 Mar 2014 23:20 GMT

Author: Reuters

By Joseph Ax

NEW YORK, March 4 (Reuters) - Steven Donziger, the Harvard-educated lawyer who has waged a two-decade battle against Chevron Corp over pollution in the Amazon jungle in Ecuador, is not one to accept defeat quietly.

Hours after a federal judge in New York ruled on Tuesday that he had used bribery and fraud to secure a $9.5 billion judgment against the oil company in Ecuador in 2011, Donziger promised to appeal and said the judge had let his "implacable hostility toward me ... infect his view of the case."

Critics, including Chevron, have painted Donziger as nothing short of a criminal, a lawyer who took advantage of a corruptible judicial system to buy a favorable judgment.

Supporters see him as a hard-charging hero who has spent 20 years fighting for impoverished villagers whose home was ruined by millions of gallons of toxic sludge.

U.S. District Judge Lewis Kaplan, who oversaw a trial last fall on racketeering allegations brought by Chevron against Donziger, made it clear he was in the former camp, writing that there was "clear and convincing evidence" that Donziger had paid a judge to ghostwrite the Ecuadorean opinion.

"There is no 'Robin Hood' defense to illegal and wrongful conduct," Kaplan said.

Donziger, who had unsuccessfully tried to get Kaplan removed from the case, had predicted for months that he would lose, mostly because of what he said was Kaplan's obvious bias. He said Kaplan exhibited clear animosity toward him and routinely ruled against him, including in a decision to oversee the trial himself rather than putting the case to a jury.

The trial pitted the enormous resources of Chevron, represented by the powerful law firm Gibson Dunn, against Donziger's smaller team of lawyers, activists and volunteers, a contrast Donziger has noted several times.

In written testimony during the trial, he accused the company of "the most well-funded corporate retaliation campaign in history."

Chevron's legal team included several top partners at the firm, and it has said in court papers it has expended millions of dollars on the litigation.

During the trial, Donziger acknowledged that he stood to earn $600 million in contingency fees if the $9.5 billion judgment were collected in full.

"CRUDE"

Donziger, who is in his early 50s, first learned of the pollution in the early 1990s from a law school classmate. He traveled to northeastern Ecuador with the classmate's father, who was seeking lawyers to help him bring a case against Texaco over allegations that it had contaminated the area surrounding an oil field.

He would become the driving force behind the litigation, eventually winning a judgment for $18 billion in 2011 against Chevron, which had acquired Texaco. Ecuador's highest court later cut the judgment down to $9.5 billion.

Donziger was featured in the documentary film "Crude," which chronicled the fight over pollution in Ecuador. Chevron used outtakes from the movie during the trial, including clips that showed Donziger discussing what he saw as endemic corruption in the country's judicial system.

It is not clear whether Donziger, who is a member of the New York bar, could face disciplinary action as a result of Kaplan's findings. At one point in his 497-page decision, Kaplan wrote that the "professional consequences of Donziger's behavior" may be addressed by other bodies.

During a call with reporters on Tuesday, Randy Mastro, an attorney for Chevron, declined to comment on whether the company would refer Donziger to the state's attorney disciplinary committee.

A foreign correspondent before attending Harvard Law School, Donziger has a talent for self-promotion, meeting midtrial with journalists in November in a crowded loft apartment in Manhattan where 14 members of his team had been living and working.

When he testified, he had sympathizers among the audience, including the singer Sting, who with his wife, Trudie Styler, has offered the villagers support.

Standing well over 6 feet (1.8 meters) tall, with graying temples, Donziger admitted he had made some mistakes but adamantly denied using fraud to win the Ecuadorean judgment.

However, he faced difficult questions from Chevron's Mastro, who pointed to emails from a colleague that referred to two judges as the "puppet" and the "puppeteer" as evidence of a bribery scheme.

Donziger dismissed the references as joking nicknames.

Both judges testified at trial, one for Donziger and one for Chevron.

The author of the 2011 judgment, Nicolas Zambrano, said he wrote the opinion on his own and denied taking bribes.

But Kaplan said his story was not credible, given that he seemed unable to answer basic questions about the ruling while on the stand. Instead, Kaplan said, it was clear that Donziger's team had arranged for the judgment to be ghost-written.

The second judge, Alberto Guerra, said he accepted payments from Donziger's team in exchange for writing the judgment in secret. During the trial, Mastro pointed to entire sections of the judgment that appeared identical, word-for-word, to internal documents held by Donziger's team.

Donziger argued that Guerra had lied on the stand after Chevron compensated him for his time and paid to relocate his family.

In her closing argument, one of Donziger's lawyers, Zoe Littlepage, acknowledged that he might be a "jerk" but said, "That's not a crime."

Mastro, however, said during the trial that Donziger had engaged in a scheme that would "make a Mafia boss blush."

"Lawyers don't do these things," he said. "Criminals do."

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